Unraveling the World of Compound Interest: Calculations and Real-Life Applications

1. Find the compound amount and the interest earned for the following: Amount: $980 Rate: 8%, compounded quarterly Time: 5 years 2. Find the interest earned if $2750 is deposited on June 12 and withdrawn on August 30. Assume 3.5% interest compounded daily. 3. Find the present value for the following: Amount needed: $20,000 Time: 10 years Rate: 5%, compounded semiannually 4. What is the effect of inflation on spendable income? s. Application Problem: Describe a practical example where you do, or could, use the concepts of compound interest found in this chapter in your life.